July 20, 2005

08:23:49 am The Philippines--What are the Structural Problems?  

Before we head off to the Middle East and Europe, we have one final post on the Philippines. We have read numerous magazine and newspaper articles over the past 15 years that began something like this:

In [insert any year in the 20th Century up to the early 1960s], the Philippines [and Burma] was [were] viewed as one [two] of the most promising economies in Asia. Since then, the [these] country [countries] has [have] been an economic disappointment, never realizing its [their] potential, where countries once seen as less promising, such as South Korea, Taiwan, Singapore, Malaysia, and Thailand, have zoomed past the Philippines [and Burma] economically.

Future versions of similar articles will be able to add China to the list of countries that has passed the Philippines, and we wonder if others such as Vietnam will also see the Philippines in their rear view mirror some day. (China's per-capita GDP was half or less of the Philippines 15 years ago; now they are equal, with China on a much faster trajectory. Vietnam's per-capita GDP, however, is less than half the level in the Philippines today.)

The question that interests us is why? Burma, now Myanmar, is rather easily explained. A coup overthrew the democratically elected government in 1962, and various repressive military governments have held power since. These governments have pursued an isolationist, socialist economic policy that have put the country more on par economically with countries in Africa rather than Southeast Asia. It's not the military per se that is the problem for Myanmar, but rather their economic policies. In fact, military or at least non-democratic governments were a feature of most of Southeast Asia's fast-growing economies during the 1960s, 1970s, and 1980s (for this reason, the Philippines economic stagnation cannot be explained by pointing to a lack of democracy for 14 years under Marcos).

The Philippines, on the other hand, appears to have many things going for it--a large domestic market in terms of population, democracy, and English-language skills--but it can't seem to ever get going. The articles we have read have never really satisfied us in terms of providing a comprehensive answer. So here we offer our take, from having lived in the country, thought about this for 15 years, and visited recently. In fairness, the Philippines have made tremendous progress in the past 15 years as we documented in our other posts on the country. Visually Nick observed more change in the Philippines than any other country in Asia he visited 15 years before (although it must be pointed out that he did not visit China post-Tiananmen in 1990). Nevertheless, statistically, while the Philippines made absolute progress, relative to other Asian countries it gained no ground, and perhaps fell further back.

Such an analysis could fill a book, which is not our intention here. Thus, with limited patience and without apology, we offer a few reasons that record our view on the structural issues in the Philippines.

Population growth. As discussed in our Country Background post, the Philippines are hurt by too high population growth of 2.0%-2.5%.

Roman Catholic Church. The church, a legacy of nearly 400 years of Spanish influence, pervades many aspects of Philippine society. While the church undoubtedly is beneficial in many areas, it is harmful in our opinion in at least three ways. First, it is far too heavily involved in politics, often making or breaking presidents. While this was useful in overthrowing Marcos, in general we think the country would be better off if church leaders curbed their desire to play kingmaker. Second, the church has a backwards view on population control, opposing all forms of unnatural birth control. This unrealistic policy keeps the people poor and the pews full. Finally, we think the church furthers a Filipino belief in fatalism--that the outcome of events is predetermined, and not the result of human action. Too often, we have observed Filipinos being swept along with the tide of events, thinking they cannot or even should not change the tide. Now this comment is subject to an immediate objection--wait a minute, haven't People Power revolutions twice thrown out corrupt presidents? Yes, they have (with significant church intervention, we would add), but we are not sure this invalidates the point; after all, all rules have exception. Further, we would argue the last thing the country needs now is another demonstration of People Power. Useful once and maybe twice, it is a bad precedent if it is used again this century.

Spanish Colonial Rule. In our final post on South America, we observed that every Spanish colony has a history of political instability. We don't think the Spanish were particular good colonialists, compared to the British. Whatever the reasons--pervasive influence of the church, a poor colonial attitude or model that emphasized wealth extraction rather than nation building--the results observable today are striking.

Lack of Leadership. Without noting the pros and cons of the various Filipino presidents, let's just agree that if the US has the good luck of having a series of good role models at the top at the beginning of our history to set a precedent for their successors to follow, the Philippines has not had the same good fortune. Too often Philippine presidents have had poor judgment, been corrupt, been incompetent, or not been willing to take tough action to do the right thing for the country. (President Aquino, who followed Marcos, is an example of the latter. She had impeccable moral leadership--coming to power in a revolution that overthrew her husband's murderer--but she was too weak, and perhaps over her head. The current president, Arroyo, is competent and may be tough enough, but severe judgment issues have undermined her.) This may be simply statistical variation, or the root cause may be endemic, and perhaps revealed in some of the other entries here. Whatever the reason, the Philippines need a series of strong leaders who can fix the problems and set the example for their successors.

Too Little Respect for the Rule of Law. We see two issues here. First, there is the typical high level of corruption and inconsistent application of the law. Second, perhaps in response to the Marcos dictatorship where press and political freedom were suppressed, there is too quick a tendency toward mob rule. We observed exactly the same thing in Argentina, which similarly suffered through and overcame a dictatorship in the 1970s and 1980s. The press and politicians, if anything, are too free. They will say or print anything, no matter how unreasonable or reckless. There is a standing group of leftists, students, and farmers ready to protest over anything. Price of gas up five cents? Let's march on the capital and call for the president's resignation! Personal restraint is in short quantity and much needed. Too often, the political scene resembles the machinations of college student government, with people acting emotionally and immediately with no foresight and no regard for precedent. For example, when the last president, Estrada, was being (necessarily) impeached, senators loyal to him would not allow evidence in the impeachment trial, so the rest of the senate walked out, leaving the government in stalemate. Eventually, the public took to the streets, and the president rather than resigning, took a "leave of absence." Finally, the vice president was then sworn in, an action uncertain enough that the Supreme Court had to step in to uphold the transfer of power. Even today, some supporters of Estrada are trying to restore him to power. Now, this is not the way to run a country. The people are not blameless either, for they elected the buffoon in the first place (the best equivalent we can come up with as to Estrada's qualifications would be to say he is on par with Ozzy Osbourne.)

Military. Like the Roman Catholic Church, far too involved in politics. Coup talk is recurring theme.

Taxes. Anyone who knows us well will be stunned by this statement. The Philippines has a problem that it taxes too little. There is simply not enough government revenue. We don't have the exact numbers at hand, but Philippine government revenue is something like 12% of GDP, compared to around 20% for the US, and higher for most other countries. We don't advocate that the Philippines try to get to 20% or higher, but it should strive for the mid- to high teens. The problem is two-part. First, tax evasion is rampant. Second, though, even if tax collections were at a reasonable level, the current tax rates are too low. President Arroyo has taken the tough, necessary step of raising the VAT rate from 10% to 12% and extending it to previously excluded products. The Supreme Court is presently deciding if this change is legal. It needs to be, for the country's credit rating hangs in the balance.

Wealth concentration / land reform. We don't have the exact solution here because we aren't in a position to diagnose this problem completely. Our observation is that, probably dating back to colonial days, there is too much land ownership and subsequent wealth generation ability concentrated in too few hands. We are not sure whether trust busting, land reform, inheritance taxes, or something else are the right prescription--we need to understand better how much of a problem this is today, if at all.

Public infrastructure. See taxes entry. The government needs to spend more on roads, ports, subways, etc. They don't have the money.

Education. The educational system has not kept up with competing countries. 10 years primary education is two years too few. 15 and 16 year-old high school graduates are not ready to face the world. Cost is an issue. See taxes entry.

Barriers to foreign investment. Without being able to point to specifics, Nick's view in 1990 was that there was not as much foreign investment as there ought to be, perhaps due to foreign exchange controls, excessive regulation, or other market barriers. To the eye, this seems less of an issue today, possibly due to reforms under President Ramos in the mid-1990s. While there is usually more that could be done, we don't have a sense of whether barriers to foreign investment remain an issue today or not.

There is talk now in the Philippines of replacing its presidential system with a parliamentary form of government, given the problems the country has had with its presidents. Initially this struck us as wasting time by not addressing any of the core structural problems. It's always more interesting to fritter away effort on a feel-good project of designing something new rather than fixing known deficiencies in your present system. It could be argued, though, that this addressing a structural issue, given the checkered record of Filipino presidents. Whatever system the country has going forward, it needs a tough, incorruptible leader, who offers no feel-good promises, only straight talk and hard work, putting the country ahead of all personal interests. A Filipino Lee Kuan Yew if you will. Someone whose conviction and willpower does not waver in the face of inevitable obstacles or a negative opinion poll.

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July 11, 2005

11:12:56 am The Philippines: Sunday, July 3, 2005 - Friday, July 8, 2005  

Country Background

Population: 86 million. This figure was around 60 million when Nick lived here in 1990. The rate of population growth, at between 2.0%-2.5% annually is one of the highest in Asia, and a big problem holding back the country's economic progress. The Catholic church deserves most of the blame--over 80% of Filipinos are Catholic, a legacy of Spain's nearly 400 years of influence in the islands--as it opposes all forms of birth control. A poor, rapidly growing population keeps the church pews full, we guess. There is a strong link between reduced population growth and economic development. Although if population growth slows to the point where the overall population is projected to decline, that's bad too, as we have said in prior posts, most recently in our Japan post. The balance needs to be right, not too fast like the Philippines, and not too slow like Japan. The US is growing about 1% per year, which seems like a good rate to us, at least for it at this point in history.

Per capita GDP: $4,600 in purchasing power parity; $1,080 in absolute terms. The large difference between these two figures implies that the cost of goods, services, and labor are very cheap here.

Size: slightly larger than Arizona

Currency: Philippine peso, 56 per US dollar. When Nick arrived in the Philippines in late November 1989, the exchange rate was around 20 to 1. About one week later, it was 30 to 1 due to the coup. It dropped to 40 to 1 with the 1997-98 Asian Crisis, and was 50 to 1 by the end of 2000. It has drifted down to 56 to 1 gradually over the past four and one-half years. This peso depreciation offsets local inflation to keep dollar prices cheap. While dollar prices are higher than in 1990, relative to other countries, the Philippines are as much if not more of a bargain as it was then.

Language: Tagalog and English are both official languages. The English here is better than any other Asian country, including the other English-speaking areas of Singapore, Hong Kong, and India. Most Filipinos speak good English, but to each other they converse in Tagalog or Taglish, mixing Tagalog and English words in the same sentence. The use of Taglish can be quite frustrating for example if you are trapped in an apartment during a coup with only local TV stations available to you. One ATM we used offered two language options: English and Taglish, but not Tagalog.

Trip Itinerary:
China Airlines flight from Taipei to Manila
Five nights at The Peninsula Hotel, Makati area of Metro Manila

City Background:

Metro Manila

Sunday, July 3, 2005 - Friday, July 8, 2005
Temperature high/low during our stay: 90/75
Population: Approximately 10 million.

Metro Manila is comprised of over a dozen adjacent cities, including Manila, Quezon City, and Makati. When people refer to Manila, they usually mean Metro Manila in its entirety, as there are no distinctive boundaries between the various cities. Manila itself is not that interesting, in our opinion. It was the second most destroyed Allied city in World War II after Warsaw, and with the shift of the business center to Makati after the war, the economic life drained out of the original city for which the metro area is named. Business travelers may never set foot in Manila, instead spending nearly all of their time in Makati. Since Nick lived there, and since most of the nice hotels, shopping, and restaurants in the country are there, that is where we stayed.

Notable Activities:

Makati. Nick spent most of his time walking around observing what had changed. A lot had. See subsequent post.

The Manila American Cemetery and Memorial. This is largest American war cemetery outside of the US with over 17,000 burials and over 36,000 missing soldiers commemorated. Located only a few miles from where Nick lived previously, this was his first visit, perhaps an indication of the differences in interests at age 38 versus age 23. See image gallery for pictures of this moving site.

Dinner with AJ Enriquez. The project Nick worked on in 1990 had about 60 Filipino employees on it, but most now live in the US. AJ worked closely with Nick then, and after living in the US for much of the 1990s, AJ is now back in the Philippines. It was great to see him for the first time in 15 years. We reminisced about the old days, talked about how much Makati has changed, and discussed the Philippine political situation. See the image gallery for AJ's new hairdo or lack thereof.

Philippine Basketball Association (PBA) Finals, Game 3: Talk 'n' Text Phone Pals 103 San Miguel Beermen 77. San Miguel still led the best of seven series two games to one. San Mig is the New York Yankees of the PBA, playing in the final something like 27 out of the 31 years of the league's history, winning around 17 times. Talk 'n' Text have won two titles in recent years, though. Yes, all of the team names are corporations, which is the norm in Asian sports leagues. US leagues are far less commercialized than leagues in other countries, but not a single US sportswriter seems to be aware of this.

Corregidor Island tour. Corregidor was the last position held by the US in the Philippines after Japan invaded. General McArthur fled from this island to Australia where he issued his "I shall return" proclamation. The story of Corregidor is a powerful one with US forces holding off surrender for five months after the initial Japanese attack, and Japanese forces engaging in suicide attacks and mass suicide when the US retook the island three years later. The tour takes you into the Malita Tunnel, a series of underground laterals and caves featuring a 1000-bed hospital and the temporary residence of Philippine Commonwealth President Quezon, once he evacuated Manila. You see the bombed out barracks and gun batteries from the war and numerous memorials built since the war. See image gallery. Highly recommended.

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11:11:01 am The Philippines: Stunning Changes but the Same Old Political Problems  

Having been away for 15 years Nick expected significant change. The magnitude of change in Makati, though, staggered him, and as a pleasant surprise, nearly all of the changes were good. For the first two days, he tended to walk around with his mouth open. The amount of change in Makati exceeded any other place in Asia that he was revisited on this trip. Admittedly, he was in a better position to notice change in Makati, having actually lived there for a year, as opposed to just visiting for a few days in the dozen or so other countries.

Having prepared Deanna for the worst, she never really understood what he had been complaining about. "This is like a tropical paradise--sort of like California with cheap prices," she said two hours after arrival. Nick thought to himself that he had done an excellent job of expectations management. He also knew that first impressions, while vivid and lasting, often prove incorrect over time. He thought about how much he enjoyed this first three months in the Philippines, coup and all.

Speaking of which, some things do not change. In 1989, on his sixth morning in the country, Nick awoke to a phone call from his manager, "There has been a coup." Now 15 and one-half years later, the Philippines current president, Gloria Arroyo, was in trouble. The week before we arrived, she admitted finally that she had made "a lapse in judgment" by speaking with the head of the election commission the night of her 2004 election. This possible election fraud--and it is not certain that any fraud has occurred or if it has that it affected the outcome or was any worse than possible fraud conducted by the opposition--has led to calls for her to resign and coup rumors. However, public protests have been mild to date. Having ousted two presidents through People Power demonstrations, including Arroyo's predecessor in 2001, there is not much appetite right now to go down this path a third time.

Our friend AJ Enriquez said before our arrival that we had little to worry about because none the three most important constituencies--the Catholic Church, the military, or the middle class--favors a change in presidents now. This reminded Nick of a similar feel-good statement made to him by a Filipino executive on the morning of the December 1989 coup: "Don't worry, the rebels know better than to come to Makati!" The next day the rebels did come to Makati, taking over the building Nick lived in to set up sniper positions. In fact, there was nothing to worry about during our 2005 visit, which went off without a hitch. But the political heat keeps rising on Arroyo, as one opposition politician or public figure after another keeps falling all over themselves to make their self-righteous statement of indignation against her. We wondered as we were leaving the country if the combination of Filipino fatalism, a press willing to publish any remark, and a history of the rule of law being trampled upon when it comes to presidents, would yet result in the outcome that the majority does not want. For now, we expect Arroyo to stay in office, but her hold on power is certainly tenuous.

What a Difference a Decade and a Half Makes

So, as we said, the magnitude of typical changes--new buildings erected, old buildings torn down, the new being nicer than the old--was greater than expected. More remarkable to Nick, however, were subtle cultural changes that you would not be aware of had you not lived in a place. Erecting a building is an easy task compared to changing society's behavior. Societal habits build up over decades and centuries after all.

The single biggest difference Nick noticed was in the quality of restaurant service levels. If you have never been to the Philippines and you were to go to there now, you would not notice anything about the service quality. It would be similar to what you are used to in the US--generally good, with an occasional outlier experience that is either exceptional or poor. That you would not notice anything now is what's remarkable (it's like good refereeing--you don't notice it). For in 1990, there was much to notice.

In 1990, where Nick worked, the lunch break was 90 minutes long. There were dozens of nice sit-down restaurants within walking distance, but none was capable of seating you, taking your order, serving your food, and settling payment in less than 75 minutes. Thus, if you decided quickly on where to eat and walked there and back briskly, you could just about get a meal in during the 90-minute break. The Americans on the project did not necessarily want to take 90 minutes for lunch, so after a few months frustration we re-engineered the lunchtime ordering and payment process to fit our needs. Upon being shown to our table, we told the server not to leave, we all then ordered from memory, and requested the check be brought to us immediately. After a few visits, the bewildered Filipino staff got used to our rude but efficient American ways. The check still took its normal 20 minutes to arrive, but we were able to settle payment shortly after finishing our meal--assuming of course we paid in cash and had exact change--rather than having to suffer an interminable wait. Thus, we cut our lunchtime allotment from 90 minutes to 60.

Fast forward to 2005. Here is a composite of our dining out experience in Makati, juxtaposed against 1990.

1. 2005: Staff shows you to the table. You are given one menu per person. 1990: Staff did not have menus with them, requiring a second trip after a long delay, which produced one menu per table. A request for more menus brought a long sigh, a slow walk away, an additional unreasonable delay, before exactly one more menu was produced, regardless of the size of your group.

2. 2005: There are normal napkins at the table. 1990: if requested, you were given begrudgingly one napkin, the size and durability of a Kleenex pocket tissue.

3. 2005: Staff waits at or near the table for you to order. Actually, this is unusual in the US, but highly efficient and appreciated by us since we eat every meal in a restaurant and thus desire a quick meal to eat more than having a relaxing dining experience. We actually had to send them away to give us more time to order, something Nick would have never risked doing before in the Philippines.

4. 2005: When you place your drink order, instead of rushing off, the order taker waits to see if you want also to order your food. When you are done ordering, they carefully repeat exactly what you have ordered including any special requests to ensure they have understood correctly. Food arrives in a reasonable time. 1990: you had to lasso the person to be able to order food with drinks. Order was never repeated, requests rarely came out correct, but the food took so long to arrive that sending it back was unthinkable.

5. 2005: If you finish a drink, you are asked if you want a complimentary refill (common in the US, uncommon elsewhere, unheard of here in 1990). As an aside, while this is not true in the Philippines, drink prices outside the US often are twice as much for about one-half of the amount. And if you want more, you pay again, pal. So, for example, two or three glasses of ice tea at a meal which would set you back $1.50-$2 in the US might cost you $10 or more in Hong Kong, that is until you learn not to request that second glass. For an American, this is maddening. For most Asians or South Americans, though, they cannot understand why a customer would expect to get more for free. Actually in terms of logic, they are correct; nevertheless, illogically this infuriates us. Thankfully, however, the Philippines have become an oasis of free refills.

6. 2005: Several times during a meal, the staff will check in to see if everything is okay, if you need anything, and so on. 1990: despite staffing levels several times that of a US restaurant, you could never actually get anyone to come to your table. The staff was usually off in a corner, giggling amongst themselves (probably at the table of Americans who asked for the check when they placed their food order).

7. 2005: It is no problem to get the check quickly. Payment can be made in cash or by credit card. Change or the credit card receipt arrives without undue delay. 1990: Don't even think of using credit cards. They are probably not accepted, but even if they are, your card will likely expire before the transaction is processed, the wait will be so long. As for cash, better to always have correct change, to be able to leave 10 minutes earlier.

The changes in Makati service levels are so extreme that Nick noticed it within the first minute of sitting down at our first meal. The change continued throughout that meal and was present at literally every meal we ate, regardless of the type of restaurant or who owned it. It was if the government had put on a 15-year long public service campaign, spending millions of dollars, on how to wait tables properly. We mentioned this observation to AJ and he immediately knew what we meant. Having lived for many years in the US, he was aware of cultural differences between our countries. "When I first ate in the US in the early 1990s, I could not believe it when the waiter asked me if my meal was okay. No one ever asked that in the Philippines at that time," he related.

So what brought about this sea change in customer service levels? Like most social phenomenon, there are probably numerous factors that led to this change. Filipinos frequently travel to the US and many of them work and live in the US and other foreign countries, so as they have become more aware of customs in other countries, they have probably become more demanding of service levels in their country and less tolerant of poor service. Further, outsourced call centers are becoming a significant employer, so even Filipinos who don't travel or work outside their country, are receiving training in how to provide excellent customer service in their jobs. Many of these call centers are in Makati, and workers who are expected to provide good service on the job probably now expect good service when they are the customer. The biggest reason, though, in our opinion, is that the restaurants have changed. Before the restaurants tended to be sole proprietorships. Often, these were run by foreign ex-pats, typically older individuals who decided to stay in the Philippines because they enjoyed the relatively slower pace of life and the opportunity to date subservient women half their age. Those restaurants are nearly all gone now, replaced by corporate-run restaurants from the US, Japan, Singapore, and locally, with no tolerance for lax processes. In a separate post entitled Philippine Memory Lane, we trace what has happened to some of the old restaurants where we used to enjoy the food and endure the service.

So New Orleans, San Mig, and Flavors and Spices have now been replaced by TGIFridays, California Pizza Kitchen, and Hard Rock Cafe (a legitimate one, not the bootleg versions that were here before). And Outback, Tony Roma's, and Chili's. Starbucks is everywhere, or you can try Gloria Jean's or Seattle's Best. There's even Bubba Gump Shrimp! From Singapore, there's Banana Leaf Curry House and BreadTalk. From Japan, there's Yoshinoya. While there are now plenty of recognizable restaurants, the number of locally owned restaurants is even greater. Unlike the elegant but sleepy restaurants of 1990, however, the 2005 versions have the service levels of the imports. They tend to be more fusion in nature rather than strictly offering the cuisine of one specific country. Moreover, they've become hip, complete with designer furniture and techno music ambiance.

When done eating you can now shop at Prada, Louis Vuitton, Bulgari, Kate Spade, Kenneth Cole, DKNY, Bally, and any other designer boutique you can imagine. For more everyday needs, there's Guess and Nine West. You can buy a CD at Tower Records, have an ice cream at Haagen Dazs, work it off at Gold's Gym, before you head back to your Oakwood corporate apartment.

For entertainment, Makati has even more movie theatres than before. But the experience has completely changed. US blockbusters are released here immediately, not months later. The theatres are new with stadium seating and surround sound. People no longer walk into the movie during the middle and then stay through the next showing until it gets to the part they have seen. Seats are reserved so that you do not have to go early to find a good seat, and the theater no longer reeks of urine. (Reserved seating exists in many countries outside of the US, and we are a bit puzzled why US theaters have not adopted this convenience.) In other words, the experience is just like the US--better actually, when you consider the benefit of reserved seating. The prices are higher of course, but still a bargain. In Makati we paid 130 pesos (about $2.30), but we saw other reserved seat theaters advertised at 90 pesos ($1.60), with general admission theaters at 75 pesos ($1.35). In 1990, pricing was two-tiered, with the higher priced seats not necessarily being much better, but rather separating you from the people in the lower priced seats. Prices were something like 15 pesos and 10 pesos then (around $0.50 and $0.33 at the exchange rates then), so the better experience has come with a much higher price tag.

Overall, the retail areas of Makati are quite different. That is not to say that nothing is recognizable. In ballpark figures, let's say that 50% of the shops and restaurants are new, 20% was there before but is now in a new location, and 30% is where it was before. But even this 30% is sometimes hard to recognize because everything surrounding it is different, so it looks out of place even though it has not moved. The Landmark hypermart is still there, more crowded than ever, and at first glance unchanged, although definitely beginning to fade as it ages. Walking through the supermarket in the basement, however, you notice that it too has changed. The produce section is full of fresh fruits and vegetables, not a limited selection of picked over items. The aisles are full of varied products. In the past, within a given category, you might see hundreds of an identical item and nothing else, if that's what arrived on the on the cargo ship that week. Modern inventory management has arrived. You no longer have to hold your nose as you walk through the fresh meats section. They even have Snapple, although with only six bottles of raspberry iced tea and about a hundred peach iced teas it appears the inventory management algorithm broke down here.

When Nick returned to the US in 1991, he loved going to the grocery store and admired the amazing selection of products. US stores had everything you could ever want in multiple brands, flavors, and sizes. If you saw something you liked, you did not need to buy a three-months supply, afraid that it might not appear again for that long. Such a repatriation experience seems unlikely now.

National Bookstore is still there, but now so are many other newer, more modern competitors. The quality of the paper used in the books is now the same high-grade white paper as in developed countries, not the low-quality gray writing tablet kind of paper used in 1990.

Pizza was available in 1990 from places like Pizza Hut and Shakey's. While we often consumed the product, it never tasted quite right. Now, there is no difference in taste between California Pizza Kitchen in the US and in Makati.

The scale of shopping has multiplied along with the quality of the service and products. Where there was the Greenbelt Mall, now there are Greenbelt 1 (the original), Greenbelt 2, Greenbelt 3, and Greenbelt 4. Across Makati Avenue, the one-story open-air Makati Commercial Center has been mostly demolished to make way for Glorietta 1-4, four connected, enclosed malls, each three stories tall.

Arriving and Getting Around

Politics are not the only thing that has not changed. Outside of Makati, the pace of change is much less, barely noticeable at all in some places in Manila. The airport looks identical, but 15 years the worse for wear. That is very unusual--we cannot think of another airport we have been to that has not changed dramatically over the past 15 years. Those reassured by the familiar can take comfort that around the baggage claim carousel there is still the same parade of cardboard box after cardboard box, containing gifts and goods for local Filipinos from their stateside relatives (see image gallery).

Fortunately, one thing has changed at the airport and this has improved the airport experience more than any renovation program could have. It used to be that as soon as you exited customs, the doors opened, the muggy humidity hit you, and you were suddenly and unexpectedly face to face with thousands of smiling Filipinos, a sight and experience quite intimidating for a jet-lagged new arrival. If you had not arranged transportation ahead of time, you now were condemned to figure things out while hauling your luggage through the sweaty crowd, with every other person asking, "You need taxi, sir?" Bracing for this, Nick had arranged for our hotel to pick us up and he ordered Deanna to stay close to him as we exited customs. The doors opened, Nick tensed up, and then nothing happened. The weather was pleasant. He could see in front of him. There was no mass of humanity blocking our path. In other words, it was just like most civilized airports. Outside, we quickly found the airport driver and he explained that the crowds were now kept well away from the exiting passengers. Others can lament that perhaps the Pinoy custom of an entire village turning out to greet a returning neighbor may die out, but for us this was a very welcome change.

For completeness, we will report that there is another terminal, but we don't know if that is new or if Nick just never had a flight in or out of it before. In any event, the main international terminal is the one Nick has always flown into and it looks just the same. We did read in the newspaper that a third terminal was about to open--it has actually been ready for a while, but the opening is halted over some construction payment issue--so some progress appears to be occurring. We do not know what the scope of this third terminal is to be (domestic versus international, or how many carriers will utilize it).

AJ told us that the roads infrastructure outside of Manila was much improved, but we did not venture outside of the metropolitan area to test this for ourselves. Traffic inside the metro area is quite bad, but that is nothing new. In 1990, Nick thought Manila had the second worst traffic in world, next to Bangkok. For her part, Deanna did not think traffic in Bangkok was very bad when she was there in 2000. Whether that's due to Bangkok's subway system (which did not exist in 1990), a lessening of economic activity in 2000 due to the Asian Crisis, luck, or selective memory on the part of one or both of us, we do not know. For its part, Manila now has three LRT lines instead of just one and there is more focus on overhead walkways and tunnels to keep pedestrians away from street traffic. Nevertheless, there are also nearly 50% more people in the Philippines, so these measures--while helpful--are not resulting in an overall reduction in the level of traffic.

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11:08:39 am Philippine Memory Lane  

As a sort of Appendix to our post on the changes in the Philippines, here we list some of places that Nick and his US Andersen Consulting colleagues used to haunt in the Philippines, nearly all of which no longer exist. Anyone is welcome to read this of course, but it will be of most interest to those who lived there. Read the "Stunning Changes but the Same Old Political Problems" post if you want more of an overview on the changes in Makati.

New Orleans restaurant. Building torn down to make a rather ugly two-level parking lot. This is probably the only change in Greenbelt that seems to be a step backwards.

San Mig. This British pub with the Saturday-night curry special (the perfect meal prior to watching MacGyver and Star Trek Next Generation reruns) suffered the same fate as New Orleans. Other locations still exist in Metro Manila.

Flavors and Spices. Closed last year. Signs still up, but space is now a used bookstore.

La Primavera. Same as Flavors and Spice. Signs still present, restaurant not. Nick cannot remember this restaurant, but the name is familiar, so he thinks we went there with some frequency.

Spanish restaurant in Greenbelt Park, name may have begun with a G, served great peppercorn steak. Gone. Building likely torn down to make way for Greenbelt 3.

Aunt Mary's Aunt. Mexican. Did anyone other than Martin actually like this dark place? Gone.

French restaurant near corner of Leap and Dela Rosa. He doesn't remember the name of this place, but Nick had a memorable male-bonding meal and night out here right before he left the country. Building torn down as part of the Ayala Museum expansion/Greenbelt 4 construction.

Schwarzwalder. Germany restaurant. Building is gone for same reasons as the French restaurant. Restaurant is one of the few in Makati one on this list that lives on, having relocated to Makati Avenue just past the Peninsula.

Faces Disco. Same fate as French restaurant and old Schwarzwalder building. History.

Japanese teppanyaki restaurant on second floor of same (?) building as Schwarzwalder. No more.

Japanese teppanyaki restaurant in Makati Commercial Center near Ritz Towers where we had to exit through the kitchen as rebel troops began patrolling the parking lot. Not even a historical marker remains.

50's American dinner near corner of Leap and Greenbelt Drive where Nick got food poisoning from Pork Hawaiian. Gone, thankfully. Replaced by a Burger King, we think.

Brick oven pizza place that opened around November 1990. Can't remember exactly where this was, but likely gone.

Pasta place that opened in mid-1990, similar to Mama Mia in Chicago (pick a pasta, pick at sauce, they cook it, you pay and take cooked meal to your table), always crowded. Like Mama Mia, now a relic of the past.

Fabulous Italian gelato place in Greenbelt Mall that opened mid-1990. This open-air area is now covered and the gelato place is no more. Haagen Dazs is everywhere now, instead.

Swiss fondue restaurant. The building remains, the restaurant does not.

British pub, name forgotten, where we watched the 1990 World Cup games. Wasn't this near the Swiss fondue place? In any event, no sign of it today.

Now for a few things that have not changed:

Bootleg Hard Rock Cafe in Malate section of Manila. The place is still there, complete with the airplane crashed into the building. IP laws being what they are, however, it is now called Unplugged, acoustic bar and restaurant. A real Hard Rock Cafe is now open next to Landmark.

Hobbit House in Malate. Jeff Harvey would be proud--the Hobbit House lives on. We did not go inside, but there's a picture of the outside in the image gallery.

Hotels: Peninsula, Intercontinental, Nikko, Mandarin Oriental. Unlike the restaurants, all of the five-star hotels remain, in the same buildings as before. Joining them is the Shangri-La between the Peninsula and Landmark (it was being constructed in 1990) and the New World Renaissance Hotel just south of Greenbelt.

Landmark. You can still live it up at Landmark. When we were there, there were approximately 1 million people shopping in the grocery store. The food court looks the same, and they still serve McSpaghetti at McDonalds, not that we had any.

Shoe Mart. SM is still there, bigger than ever and unlike Landmark--which is looking quite frayed at the edges--SM looks newly renovated.

Rustan's. Grocery store across the street from Ritz Towers. Still there.

Grocery store in Greenbelt Park, can't remember the name, it was not as nice as the other stores. Gone, its space now dedicated to either Greenbelt 2 or Greenbelt 3.

Grocery store right next to Landmark. Gone. In its place are Glorietta 2 and Glorietta 3 malls.

Fast food places. American franchising remains resilient. Most of the places we would venture to at age 23 are still there: McDonalds, KFC, and Wendy's. Pizza Hut and Shakey's moved to new locations because their buildings were knocked down. No sign of A&W though.

Greenbelt Park and the chapel within. Both still in place, although the park is reconfigured and upgraded some. Handholding in the park observed.

Ritz Towers, Sunrise Towers, and Tropical Palms. All still there. James still works the door at Sunrise, and he enjoyed hearing an update on the MAC-PAC crew. He could not believe Chris Hasbrook is responsible enough to father a child. There's a picture of him in the image gallery. His brother works there now too.

Building where we worked. Its fate is similar to that of our project. Demolished. A 40-plus story condo building is rising in its place--see image gallery.

To read about the explosion of new restaurants and stores in Makati, that have taken the place of those no longer with us, read our related post, "Stunning Changes but the Same Political Problems."

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